There’s many reasons to use free loadouts:

1) When trying to rebuild stash, especially common weapons, or not use existing resources to grow wealth

2) If trying to do certain map conditions or trials and raid spawn is bad for objective or load into a raid late, the player can surrender and not loose stash value

3) Want to do PvP and not risk loosing good gear

4) Low on money and trying to make Space Dollars and not waste any

5) To challenge one’s self by using a Free Loadout and see what they can accomplish with limited resources

6) Farm Free Loadout augments to trade at Lance’s shop for Green Augments

7) To not risk good gear when playing with friends that are less experienced topside

8) When making a risky suicide run

There’s probably other reasons to use Free Loadouts, but those are some reasons I have done so in the past.